CD PROJEKT Group Q3 2022 Financial Results

Key insights

6 takeaways

01
CD PROJEKT Group achieved record Q3 2022 results with 245 million złoty in sales revenue, a 70% year-over-year increase, and a net profit of 99 million złoty.See it on page 3
02
The Cyberpunk 2077 franchise drove performance through a transmedia strategy, resulting in over one million daily active users for four consecutive weeks and a 90% positive rating on Steam.See it on page 1
03
The company maintains a strong financial position with over 1 billion złoty in cash reserves, despite ongoing development costs and dividend payouts.See it on page 4
04
Operational expansion includes the establishment of a new North American studio hub split between Boston and Vancouver to access regional talent.See it on page 2
05
Development resources are currently focused on the Cyberpunk 2077 'Phantom Liberty' expansion and new Witcher projects titled 'Polaris' and 'Sirius'.See it on page 2
06
Management has proposed a new incentive program for 2023–2027 designed to improve employee retention and align leadership interests with long-term shareholder value.See it on page 7

Summary

CD PROJEKT Group reported its strongest third quarter in company history for 2022, achieving 245 million złoty in sales revenue, a 70% increase compared to the same period in 2021. Net profit reached 99 million złoty, representing a sixfold increase year-over-year, with net profitability for the group hitting 40%. This financial performance was primarily driven by the Cyberpunk 2077 franchise, which benefited from a successful transmedia strategy involving the release of the Edgerunners update and the debut of the Cyberpunk: Edgerunners anime series on Netflix. These initiatives significantly boosted player engagement, with daily active users exceeding one million for four consecutive weeks and positive Steam reviews reaching 90%.

The company’s operational focus remains on long-term product development and organizational expansion. Current development efforts are concentrated on the Phantom Liberty expansion for Cyberpunk 2077, alongside the Polaris and Sirius projects within The Witcher franchise. To support these ambitious goals, the company is establishing a new North American studio hub, split between Boston and Vancouver, to tap into regional talent pools. Furthermore, management is proposing a new incentive program for 2023–2027 to improve employee retention and align management interests with long-term shareholder value.

Financial management remains disciplined, with the company maintaining a solid cash position of over 1 billion złoty despite dividend payouts and ongoing development expenditures. Administrative expenses decreased during the quarter, aided by adjustments to stock-based incentive valuations and the capitalization of development costs for advanced projects. While the company continues to support legacy titles like The Witcher 3: Wild Hunt through next-gen updates, resources are increasingly shifting toward the development of future titles, including the next installment in the Cyberpunk series, which is slated for conceptual work following the release of Phantom Liberty.